- Highlight is drill-hole K03R03 (northern area), with higher brine grades closer to the centre of the basin averaging 306mg/L lithium, low impurities and low average Mg/Li ratio of 4.3, a ratio similar to large Argentine projects of Galaxy and Neo Lithium.

- K03R03 results indicate higher concentrations of lithium bearing brines occur at depth in the northern area compared to shallow drilling (<150m) from platform K03. Drilling is underway to explore deeper sections below the best results from K03.

- Excellent passive seismic data vindicates the exploration approach and aids planning of additional drilling sites. The results of K03R03 in the north are being followed up to establish the lateral and depth extent of higher lithium grades and to assess flow rates.

- Drilling continues to expand the data set for an initial resource estimate in the coming months.

- Work in Jujuy province continues, aimed at gaining drill access to the Cauchari area.

The Company can now definitively demonstrate that lithium brine is present from near surface to over 400m depth in drill holes spaced 11km apart (see Figure 1 in link below) across the project. Drilling and seismic geophysical surveying also confirms Kachi is a very large-scale partially covered salt lake over an area of at least 22 x 8 kilometres (more than 150 km2). Brine is interpreted to continue in sandy sediments beneath gravels and volcanic rocks with the potential to increase this area significantly as they may hide the true size of the basin.

Lake has been conducting two concurrent phases of drilling operations:

1. Resource and exploration drilling utilising a diamond drill rig to collect drill cores for porosity assessment and to obtain brine samples for resource estimation, and

2. Production well drilling using rotary drill rigs for additional resource estimation data and construction of wells for test pumping purposes. These will be available to pump lithium brine into trial evaporation ponds and test the brine evaporation and chemical evolution under site environmental conditions. A total of eight drill holes have been completed on three separate drill platform locations (see Figure 1 in link below).

Note: A change in naming convention for drill sites and drill hole identification has been undertaken for management purposes where D represents diamond drill holes and R rotary drill holes.

Resource Drilling - Kachi Lithium Brine Project

Lake Resources' 100%-owned Kachi Lithium Brine Project in Catamarca province, Argentina covers over 50,000 hectares of mining leases owned 100% by Lake's Argentine subsidiary, Morena del Valle Minerals SA. These are held over the centre of the known Kachi salt lake in the deepest part of the basin. Surface sampling has revealed positive lithium results in brines, which are being explored at depth through the drilling and geophysics programs.

The current status of resource diamond drilling comprises the completion of four diamond drill-holes on four platforms and analysis of brine samples. A further diamond drill hole is currently underway at a new location (platform K05). Four rotary wells have also been drilled to date with a further drill hole recently started on platform K03 in the west of the project. Table 1 (see link below) provides drill hole location details and lithium results which are averaged where multiple samples have been taken at a single interval.

Recent drilling intersected different interlayered lithologies which are dominated by sandy sediments. Samples have been collected for porosity tests in a laboratory in the USA with extensive experience in analysing salt lake sediments for their porosity characteristics, in particular the specific yield (also known as drainable porosity). Given the success of exploration in confirming elevated lithium concentrations and favourable sandy sediments for brine extraction the company intends to conduct a resource estimate for the project in accordance with the JORC reporting code as soon as practical. This will include the porosity data and systematic brine analyses from the drilling samples.

Analytical results for lithium to date have been highest in drill-hole K03R03 (northern area). Brine samples in this hole display encouraging densities with a favourable Mg/Li ratio of 4.3. This area is a key target for ongoing investigation. In the short term drilling will return to this area and target deeper unconsolidated brine bearing sediments confirmed by the passive seismic geophysical survey. Figure 2 (see link below) shows an extensive area with potentially very deep lake sediments in the vicinity of K03 that is yet to be investigated.

Diamond drilling intersected thick intervals of intercalated sands, gravels and sandy clays with some clay horizons. The predominant litho-type of lake sediments is sand-dominant, and poorly consolidated, with relatively low core recoveries in sandy material. Initial indications from field hydraulic testing indicate high permeabilities for the sandy material, which will be further tested with the installation of large diameter production test bores.

The deepest drilling to date at 405m has been undertaken in the south of the project area in diamond drill hole K06D08 (see Figure 1 in link below).

Brine Chemistry

Brines with high density (1.18 - 1.22 g/cm3) have been intersected in thick sandy and gravelly aquifers, with the best results to date being 306 mg/L after 27 hours of airlifting from hole K03R03, installed with filters over an interval of 3 - 242m. This is located further towards the centre of the northern area of the salt lake. To date the lithium brines analysed show positive chemistry with low combined impurities (boron, sulphate, calcium, magnesium, iron). A number of sample results are pending from recent drilling from site K05 and regular updates will be provided as drilling progresses.

Average lithium grades from deeper levels (350 - 400m) in the south at K06 also show high density (1.2 g/cm3), however the brine grade of 180 mg/L suggests that the brine is distinct from that at the K03 site. Deeper horizons are now being targeted in the vicinity of site K03 where positive results have been previously found with the aim of locating higher grades and extend the potential size of the brine mineralisation.

Geophysical Survey

A seismic geophysical survey is being undertaken using passive seismic techniques, with the aim of developing an understanding of basin geometry and thickness of the sediments hosting the brine. This method distinguishes lithologies with highly contrasting seismic velocities such as unconsolidated lake sediments and harder cemented sediments, basement rocks or ignimbrites (compact volcanic ash units) and has been used very successfully on a number of salt lake projects in South America and Australia. To date 170 stations have been processed.

The distinct reflectors identified in the survey correlate well with dense lithologies such as a number of ignimbrite units within the predominantly sandy sediments and probable basement rocks intersected at 300m depth in K06D08 in the south of the project area (see Figure 2 in link below). Drilling at K06 provides a correlation with the seismic survey and indicates the presence of unconsolidated sediments to a depth in excess of 500m under gravel cover away from the areas of surface salt where drilling is currently being conducted and in excess of 600m in the vicinity of site K03. Figure 2 (see link below) shows a schematic cross-section and raw data used for the interpretation.

Importantly the seismic survey also suggests the majority of the basaltic volcanic material visible at surface forms a thin veneer overlying lake sediments, which is very positive for the project as it further increases the volume of sediments that potentially host brines.

Lake Resources NL (ASX:LKE) is a lithium exploration and development company focused on developing its three lithium brine projects and hard rock project in Argentina, all owned 100%. The leases are in a prime location among the lithium sector's largest players within the Lithium Triangle, where half of the world's lithium is produced. Lake holds one of the largest lithium tenement packages in Argentina (~200,000Ha) secured in 2016 prior to a significant 'rush' by major companies. The large holdings provide the potential to provide consistent security of supply demanded by battery makers and electric vehicle manufacturers.

The Kachi project covers 69,000 ha over a salt lake south of FMC's lithium operation and near Albemarle's Antofalla project in Catamarca Province. Drilling at Kachi has confirmed a large lithium brine bearing basin over 20km long, 15km wide and 400m to 800m deep. Drilling over Kachi (currently 16 drill holes, 3100m) has produced a maiden indicated and inferred resource of 4.4 Mt LCE (Indicated 1.0Mt and Inferred 3.4Mt) within a 8-17 Mt LCE exploration target (refer ASX announcement 27 November 2018).

A direct extraction technique is being tested in partnership with Lilac Solutions, which has shown 80-90% recoveries and lithium brine concentrations in excess of 3000 mg/L lithium and is planned to be trialled on site in tandem with conventional methods as part of a PFS to follow the resource statement. Scope exists to unlock considerable value through partnerships and corporate deals in the near term.

The Olaroz-Cauchari and Paso brine projects are located adjacent to major world class brine projects either in production or being developed in the highly prospective Jujuy Province. The Olaroz-Cauchari project is located in the same basin as Orocobre's Olaroz lithium production and adjoins Ganfeng Lithium/Lithium Americas Cauchari project, with high grade lithium (600 mg/L) with high flow rates drilled immediately across the lease boundary.

Two drill rigs are currently drilling at Cauchari with results anticipated to extend the proven resources in adjoining properties into LKE's area with results anticipated from November into December 2018. This will be followed by drilling extensions to the Olaroz area in LKE's 100% owned Olaroz leases.

Significant corporate transactions continue in adjacent leases with development of Ganfeng Lithium/Lithium Americas Cauchari project with Ganfeng announcing a US$237 million for 37% of the Cauchari project previously held by SQM. Nearby projects of Lithium X were acquired via a takeover offer of C$265 million completed March 2018. The northern half of Galaxy's Sal de Vida resource was purchased for US$280 million by POSCO in June 2018. These transactions imply an acquisition cost of US$55-110 million per 1 million tonnes of lithium carbonate equivalent (LCE) in resources.

The demand for lithium continues to be strong for lithium ion batteries in electric vehicles, according to recent data from the leading independent battery minerals consultant, Benchmark Mineral Intelligence. Supply continues to be constrained suggesting good opportunities for upstream lithium companies.